Greg Hinz On Politics

On this scorecard, Chicago rates 2nd in hunt for Amazon HQ

Chicago has some real and perhaps surprising strengths in the competition to lure Amazon's so-called HQ2 and a promised 50,000 jobs, headed by a broad and deep labor pool, a new report out today concludes.

According to the study by Anderson Economic Group, a consultancy with offices here and in Michigan that has worked with auto manufacturers and other firms, companies pretty much are looking for a set number of things when they're picking a location for a headquarters. They prize access to the right kind of labor and support services, ease of transportation both by air and for commuters, and a relatively low cost of doing business.

Anderson put together an index of factors that affect those categories, and then rated 35 metro areas that appear to fit Amazon's publicly stated criteria of what it's looking for outside of its current base in Seattle.

Chicago comes in second of the 35 cities, trailing only New York and ahead of Los Angeles, Boston, Atlanta, Washington and Philadelphia, in that order, in Anderson's analysis. Denver, thought by some to be near the top of Amazon's list, was well down the Anderson ranking at 16th.

According to report co-author Jason Horowitz, a senior consultant who heads the firm's public policy and economic analysis practice, the index equally weighs all three categories. But the range on talent pool was the widest, and on that Chicago scored fourth. The city's lowest mark, cost of doing business, was 18th, but variation among the cities was smaller than on labor.

That suggests that though large cities like New York and Chicago tend to be more expensive than Sun Belt locales, the depth of their labor pool and supporting services such as law, public relations, engineering, financial, and advertising and marketing more than makes up for it—at least for a headquarters. Assuming Anderson is right, that is.

Though Amazon is expected to stick its hand out for subsidies wherever it ends up, "it is clear that cities that fall further down on this list are going to provide more incentive and more intangible benefits in order to compete with those at the top," Anderson concludes.

We'll see. The city and state are scheduled to file a joint bid by mid-month. Amazon then is expected to cut the list of competitors down at least once and maybe twice before making a final selection by year-end.